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Can life insurance offer spousal support?

Yes, it can. This article examines the utility of life insurance policies and how they can help your spouse in your absence.

Life changes in the blink of an eye. You realise this essential truth, and to this end, you make investments and savings for your loved ones. You don’t wish them to suffer any financial uncertainty in your absence.

But the best way to ensure that your spouse and other family members are well looked after is by buying life insurance for yourself. It is a way to pay yourself for making future dreams come true, or to ensure that your family’s dreams remain on track when you are not around.

Why buy life insurance?

  • Life insurance in India is designed to provide policy holders and their families with an essential safety net for an unforeseeable future.
  • Life insurance can be of several types: Term insurance (which provides only a death benefit payable to your family), endowment policy (which pays a maturity benefit or a death benefit in case of your absence during the policy term) and money back policy (where the sum assured is paid back in periodic instalments as a regular income during the policy term) are the most common ones.
  • The sum assured of the life insurance in India is paid to the policy holder except in the case of the term insurance plan. Since the term or tenure of the policy is known to you, you can time the tenure to coincide with important future milestones. Thus, you can realise important financial goals using the insurance corpus.
  • Life insurance policies provide peace of mind to you, knowing that there is a way for your family to cope with future financial peril in your absence. This is the primary reason to buy life insurance – to get life coverage for the future, so that your savings, income and other investments are insulated against your absence.

Life insurance as spousal support

The strange thing about life is that it goes on as before, even in the face of unexpected tragedies. Though you may be absent in the future, your family must still continue living as before. This entails grappling with household expenses, children’s education, emergency medical costs, travel, food, etc.

Your spouse may be employed, but the loss of your income can make it difficult to make ends meet. Competing expenses can eat into the family income, and your spouse may have to make certain hard decisions to keep the household running.

But all of these hardships can be lessened with the life insurance policy money. It becomes important spousal support during the loss of your income to a physical disability or your unfortunate demise.

Post Author: Fathiyya Al Shaikh

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